Oil futures rose on Monday, driven by signs of a brighter global demand outlook, even as India, the world’s third-largest oil consumer, continues to suffer a record daily number of COVID-19 cases. “The most recent data continues to show that Indian demand for refined fuels such as gasoline and distillates erases virtually all of its recovery from the impact of COVID-19,” said Robbie Fraser, global research and analysis manager at Schneider Electric. “As the world’s third-largest oil importer, India’s efforts to curb what has become the most widespread outbreak of COVID-19 this year will have major implications for both oil markets and the broader economy.”
While the US continues to lead the world in cases and deaths by wide margins, with 32.4 million cases and 577,045 deaths, India is second only to the US for cases with 19.9 million after registering 368,147 new cases Monday and 3,417 deaths, according to Associated. Press. Over the weekend, India counted more than 400,000 news stories in a single day to set a new world record. “This not only jeopardizes the recovery of demand in this oil-consuming third country, but also clarifies the risks of demand for market participants,” Eugen Weinberg, an analyst at Commerzbank, said in a note. However, despite the headwinds for oil, “the market continues to show signs of strength and confidence that global demand may continue to push up,” Fraser said, in a daily note. That is partly indicated by an ongoing effort by the Organization of the Petroleum Exporting Countries and its allies, known together as OPEC +, to “start bringing some production cuts to the global market,” he said. West Texas Intermediate crude for June delivery CL00, + 1.38% CLM21, + 1.38% rose 64 cents, or 1%, to $ 64.22 a barrel on the New York Mercantile Exchange. July Brent BRN00 crude, + 1.29% BRNN21, + 1.29%, the global benchmark, rose 68 cents, or 1%, to $ 67.44 a barrel on ICE Futures Europe. On Monday, Bloomberg reported that Ihsan Abdul Jabbar, Iraq’s oil minister, told reporters that OPEC + will continue to try to keep oil prices “within normal averages” and that “there is no concern about a drop in oil prices. prices”. “The comments suggest that OPEC + remains confident in the outlook for energy demand, despite the increase in coronavirus cases in India,” said Phil Flynn, senior market analyst at The Price Futures Group. See: India’s COVID-19 crisis is a ‘crime against humanity,’ says award-winning author as nation sets new record for cases.Meanwhile, traders are also keeping a close eye on Iran, which appears to believe that It will soon be able to reach an agreement with the United States, will lift the renewed sanctions and has already boosted production and exports, “particularly to China, which does not care much about US sanctions,” Weinberg wrote. Read: Here’s how quickly Iran could boost oil production after a deal on a nuclear deal White House officials on Sunday denied Iranian state media reports that the United States had reached a deal to put end to economic sanctions and substantial negotiations looming, news reports said. The United States also immediately denied a report on Iranian state television that deals had been reached for the Islamic Republic to release American and British prisoners in exchange for Tehran receiving billions of dollars. The Associated Press said it was not immediately clear whether the report represented a move by the hardliners who run the Iranian broadcaster to disrupt negotiations on the nuclear deal. “If Iranian oil exports, which the country’s vice president estimates at 2.5 million barrels per day, were to return to the market, this would likely put pressure on oil prices,” Weinberg said. For now, however, Iran, which is exempt from the OPEC + production deal, “does not have a clear path around US sanctions at least in the short term, said Schneider Electric‘s Fraser. Returning to Nymex, June RBM21 gasoline, + 1.58% added 1.5% to $ 2.11 a gallon and June HOM21 heating oil, + 1.65% added 1.6% to $ 1.96 a gallon. Natural gas NGM21 for June, + 1.26% was quoted at 2.97 dollars per million British thermal units, 1.3% more.